What Digital Agencies Need to Know about ADA Compliance: Paper.li Blogs & More

Are you digital providing marketing services? Is usability and ADA compliance part of your auditing process? If not, you are missing out… Here’s why: What is ADA Compliance? ADA (Americans with Disabilities Act Standards for … The post What Digital Agencies Need to Know about ADA Compliance: Paper.li Blogs & More appeared first on Paper.li … Continue reading What Digital Agencies Need to Know about ADA Compliance: Paper.li Blogs & More

What Digital Agencies Need to Know about ADA Compliance: Paper.li Blogs & More

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How do I pronounce Alpha Tauri? All you need to know about F1's 'new' team

Everything you need to know about the “newest” name on the Formula One grid, following Toro Rosso’s rebrand to Alpha Tauri ahead of the 2020 season.

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Business Loans for Startups: Everything You Need to Know

The idea of business loans for startups is kind of vague. I mean, a business that isn’t even operating yet can’t exactly get a business loan. The people who want to start the business can get a loan to get going, but it will technically be a personal loan, not a “business” loan in terms of a loan to the business directly.

Business Loans for Startups: Do They Exists and How Do You Get Them?

The truth is, a startup isn’t just a business that hasn’t started yet. The term startup also includes any business that is still in its beginning stages. For example, they may be in their first round of financing, or still trying to get ramped up. Surprisingly, some businesses stay in the startup phase for up to 2 or 3 years.

Why does that matter? Because, if they have been operating for any amount of time, that changes the game. They could then potentially have business credit, which could help them get the funding they need on the merits of their business more so than their personal credit. These would be what we call business loans for startups. For many reasons, it’s harder for startups to get business loans.

Business Loans for Startups: Traditional Lenders

Not surprisingly, a lot of startups will not qualify for business loans from traditional lenders. Some will, but most will have to go the SBA route if they qualify at all. The SBA, or Small Business Administration, offers loan programs through partner lenders. More startups will qualify for these loans. The reason is, their programs are government backed. As a result, the lenders are able to be a little more relaxed when it comes to eligibility and approval. There is a lot of red tape involved, but it can be worth it if you qualify. Here are some examples of SBA loan programs that may work well for startups.

7(a) Loans

This is the Small Business Administration’s main loan program. It offers federally funded term loans up to $5 million. The funds can be used for expansion, purchasing equipment, working capital and more. Lenders include banks, credit unions, and other specialized institutions in partnership with the SBA who process these loans and disburse the funds.

The minimum credit score to qualify is 680. In addition, there is a down payment requirement of at least 10% for the purchase of a business, commercial real estate, or equipment. The minimum time in business is 2 years. In the case of startups, business experience equivalent to two years will suffice.

This is by far the most popular of the SBA loan programs, and the funds are available for a broad range of projects, from working capital to refinancing debt, and even buying a new business or real estate.

Business Loans for Startups: 504 Loans

These loans are also available up to $5 million and can buy machinery, facilities, or land. They are generally used for expansion. Like 7 (a) loans, private sector lenders or nonprofits process and disburse these funds. They work well for commercial real estate purchases especially.

Terms for 504 Loans range from 10 to 20 years. Unfortunately, funding can take up to 90 days. They require a minimum credit score of 680, and collateral is the asset it is financing. There is also a down payment requirement of 10%, which can increase to 15% for a new business.

There is also 2 year in business requirement, or equivalent experience for management, if the business is in the startup phase.

Microloans

Microloans are available in amounts up to $50,000. They work for starting a business, purchasing equipment, buying inventory, or for working capital. Community based nonprofits handle SBA microloan programs as intermediaries.

Interest rates on these loans are 7.75% to 8% above the lender’s cost to fund, and the terms go up to 6 years. Similar to other programs, they can take up to 90 days to fund. The minimum credit score is 640, and the collateral and down payment requirements vary by lender.

SBA Express loans

These loans max out at $350,000. They have a maximum interest rate of 11.50%. In addition, terms range from 5 to 25 years, and the SBA guarantee is less than it is with their other loan programs at 50%. To qualify, your credit score must be above 680. Another requirement is that you must have a debt to service ratio of 1.1 or higher. If the loan is greater than $25,000, collateral may be necessary. It depends on the lender.

The turnaround for express loans is much faster. The SBA takes up to 36 hours to give a decision. Also, necessary paperwork for application is less. As a result, express loans a great option for working capital, among other things, if you qualify.

Business Loans for Startups: SBA CAPLines

There are 4 distinct CAPline programs that differ mostly in the expenses you can use them to fund. Each carries a maximum amount of $5 million and an interest rate that ranges from 7% to 10%. Funding can take 45 to 90 days.

The four different programs include:

Seasonal CAPLines -Financing for businesses preparing for a seasonal increase in sales.

Contract CAPlines -Financing for business that need funding to fill a contract.

Builder’s CAPLines -Financing for businesses taking on a real estate or construction project.

Working capital CAPLines -Financing for businesses that are struggling with a short-term slump in sales.

Credit score must be at least 680 to qualify, and there is no minimum time in business requirement unless you are getting a seasonal CAPline. That one carries a one year in business requirement.

The SBA offers these programs, and a lot more, for small businesses. Find out more about the SBA and what they offer here.

Business Loans for Startups: What You Need to Apply

There are several things that lenders will look at, whether you are applying for an SBA loan or not. Some of it, like credit reports, you cannot control. What you can control is the presentation you make in the form of a business plan. It needs to look professional and be well written and complete. That may mean pulling in some outside help in the form of consultants, writers, or both. In general, a well put together, complete business plan includes the following.

Opening

An Executive Summary

This is a complete summary of the business idea.

Description

The description goes into further detail than the summary, describing the business. What type of business is it? What product or service will it offer? This is where you work to get others excited about your business. Note that this is important even if your business is already operating. It will just be in the present rather than the future tense.

Strategies

Layout your plan for getting started. Do you have a marketing plan, area in mind for location, or idea of how many employees you will start with? What is your ramp up plan? Again, already operating businesses will state the current operating strategy.

Research

Market Analysis

This actually includes two parts. All that market research you did goes here:

Analysis of audience

What need will your business fill, and for who? Are you a child care facility filling a need for affordable child care for working moms? Are you an eatery filling a need for a lunch spot for those working downtown? How will your business fill the need? All of that information goes in this section.

Competitive Analysis

Is there already a business working to fill this need? Is there room for more? How do you plan to compete with them?

If you are not a new business, this will be a market analysis that supports your need for funding, or that shows your business is strong and growing.

Strategy

Plan for Design and Development

How is all of this going to play out, from start to finish. What steps are you going to take? This is more detailed than your strategies section.

Plan for Operation and Management

Who will own or does own the business and who will run or currently runs it from day to day. This could be as simple as stating that you are the sole owner and operator, or as complicated as laying out a complete partnership plan or board or directors’ format. It just depends on how your business works.

Financials

Financial Information

This section includes current financials, projections, and a budget plan for the loan funds you are applying for. Lenders need to see that you know how to handle the funds you get, and that you have a plan for paying them back.

Private Lender Options for Business Loans for Startups

Regardless, any traditional lender is going to check personal credit history. They are also going to look for a higher credit score. If your personal credit score isn’t the best, consider looking at private lender options.

These are alternative lenders that have less strict eligibility requirements. They do have higher interest rates and less favorable terms than traditional loans however, so choose wisely.

BlueVine

If you have been in business for at least 6 months and have $120,000 annual revenue, you may qualify for a loan from BlueVine. Amazingly, the credit score for a line of credit can be as low as 600. Furthermore, if you want invoice factoring, you can get approval with a score as low as 530.

Kiva

Kiva is a little different. For example, the interest rate is 0%, so even though you have to pay it back it is absolutely free money. They don’t even check your credit. However, there is one catch. You have to get at least 5 family members or friends to throw some money in the pot as well. In addition, you have to pitch in a $25 loan to another business on the platform.

Accion

If your personal credit is okay, Accion may be a good fit for small business startup loans bad credit. It is a microlender, a nonprofit, that offers installment loans to both startups and already existing businesses. The minimum credit score is 575. In some places they will go as low as 500. You don’t have to already be in business, but if you are not, you must have less than $500 in past due debt. In addition, your business needs to be home or incubator based.

Loans are from 6 to 60 months and interest rates range from 7% to 34%. A personal guarantee, and sometimes specific collateral, is necessary in most circumstances.

Credibly

Credibly is also a good option for business loans for startups if you are already generating some revenue. They offer short term loans for both business expansion and working capital. You must be in business for at least 6 months to qualify, and they will approve loans to those with credit scores as low as 500.

Business Loans for Startups: Other Options for Startup Funding

Typically, a business is going to need to combine more than one type of funding to start and run a business. Of course, traditional investors are the funding source of choice. However, investors are not an option for everyone. Here are a couple of other options.

Crowdfunding

What is the newest innovation in small business funding? It is actually quite an arousing invention. Crowdfunding sites allow you to pitch your business to thousands of micro investors. Anyone who wants a piece of the action can buy a piece of the proverbial pie.

Investors pledge amounts on a broad spectrum depending on the campaign and the platform used. They may give $80, they may give $150, or they may give over $500.

Though not always required, most entrepreneurs offer rewards to investors for their generosity. Most often, this comes in the form of the product the business will be selling. Different levels of giving result in different rewards. For example, a $50 gift may get your product A, and a $100 gift will get you and upgraded version of product A. Find out more about crowdfunding here and here.

Angel Investors

Angel investors come in all shapes and sizes. From investment firms to your mom, virtually anyone can swoop in and lift a company up financially. Some of the top angel investments have become companies that change the world. Learn more about this option here.

Business Loans for Startups: Work on Overall Fundability

You need to start working on business fundability from day one, before you even think about business loans for startups. There are several reasons for this, but the most important one is that it fundability is starting long before you realize it. So much goes into it that you probably do not even realize. In fact, some of it is not even related to your business. Learn more about fundability, how it starts, and how to make it strong here.

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Minority Startup Business Loans: What You May Not Know

There seems to be a lot of confusion out there related to minority startup business loans. The fact is, there are not a lot of loans specific to minorities. This is true whether your business is still in the startup phase or an already established business.

Minority Startup Business Loans May Not Be What You Think

While specific minority startup business loans don’t really exist, there are some loans that work better for minority startups than others. In addition, there are a ton of other resources available. Some of these are minority specific, and some not.

Minority Startup Business Loans: Start With the Small business Administration

When you talk about business loans of any kind, you have to talk about the SBA. While they do not lend funds themselves, they do handle the administration of many loan programs that help small businesses get the funds they need through partner lenders.

Minority Startup Business Loans: 7(a) Loans

This is the Small Business Administration’s main program. It provides federally funded term loans up to $5 million. The funds can be used for a number of purposes. For example, expansion, purchasing equipment, and working capital can all be funded with 7(a) loans. Banks, credit unions, and other specialized institutions in partnership with the SBA process these loans and disburse the funds.

Minority Startup Business Loans: 504 Loans

504 loans are also available up to $5 million and can buy machinery, facilities, or land. Typically, they are used for expansion. In fact, these work especially well for commercial real estate purchases.

Minority Startup Business Loans: Microloans

These are $50,000 or less. Furthermore, they work well for a number of things. Business, purchasing equipment, buying inventory, or general working capital are all options for using these funds.

Minority Startup Business Loans: SBA Express Loans

These are fast turnaround loans. The SBA takes 36 hours or less to give a decision. There is less paper work as well. As a result, express loans are a great option, if you qualify.

Minority Startup Business Loans: SBA Community Advantage Loans

This one is a pilot program. It will either expire, or the SBA will extend it in 2020. Its purpose is to promote economic growth in underserved areas and markets. Decision makers look past such things as poor credit or low revenue if the business has the potential to create jobs or promote economic growth in underserved areas.

These are some of their most popular programs. However, the Small Business Administration does so much more for small businesses in addition to these. Get more details on the SBA, these loan programs, and additional resources offered by the Small Business Administration here.

Minority Startup Business Loans: Private Lenders

In addition to SBA loans, there are several private lenders that offer products that work really well for minority business owners. Below are just a few.

OnDeck

OnDeck offers lines of credit and term loans with fixed interest rates. You can get up to $500,000 with a term loan. Also, they have an A rating with the Better Business Bureau. Even better, the minimum FICO they require is 600. However, you must have $100,000 minimum annual revenue and be in business for at least one year. Find out more about OnDeck in our review.

BlueVine

BlueVine offers a number of financing options. For instance, term loans, invoice financing, equipment financing, lines of credit, and merchant cash advances are all offered by BlueVine. As a requirement, you have to be in business for at least 6 months. A minimum revenue of $100,000 and a minimum credit score of 600 is required if you want a term loan or line of credit. However, for invoice factoring, the minimum credit score is just 530! Furthermore, they have an A+ rating with the BBB. Find out more about BlueVine in this review.

Funding Circle

If you’re looking for a low APR, then Funding Circle is your place. They have fixed rate term loans that require a credit score at least 620. Unlike BlueVine, there is no minimum revenue requirement. However, they do require you to be in business for at least 2 years. They have an A+ BBB rating also. Find out more in our Funding Circle review.

StreetShares

Of course, this company also offers invoice financing, term loans, and lines of credit. Similar to others, there is a number of years in business requirement. However, they require less minimum annual revenue than the others at only $25,000. The minimum credit score is 600. Like some of the other, they have an A+ rating with the Better Business Bureau as well. Find out more about StreetShares in our review, here.

SmartBiz

SBA loans typically take a lot of time and paperwork. Still, SmartBiz found a way to speed things up. They make it easier than ever. Unfortunately, they do have stricter requirements. Your credit score has to be 650. Like others, they also require you to be in business for 2 years or more. In addition, annual revenue has to be $50,000 at least. There can be no outstanding liens, bankruptcies, or foreclosures in the past 3 years.

You Can Supplement Minority Startup Business Loans with Grants

If you qualify, there are many grant options available. While they usually are not enough to fully fund a business, they can be great for supplementing loan funds. There are not many specifically for minorities, but there are some. Here is just a sample of what is out there.

Grants Exclusive to Minorities

First Nations Development Institute Grants

The mission of this group is to offer grants that help Alaska Natives, Native Hawaiians, and Native Americans. As a bonus, they offer assistance in the application process in addition to funds.

Not only that, but there are a wide range of opportunities from the First Nations Development Institute. New ones initiate as old ones retire. There is a mailing list you can join to receive information about new opportunities as they become available.

National Black MBA Association Scale-Up Pitch Challenge

Also known as NBMBAA, the Scale-Up Pitch Challenge has cash prizes ranging from $1,000 to $50,000. The association states its purpose is to help newer businesses that have an African founder that maintains equal ownership.

Be aware, a business must be a member of the NBMBAA to compete. To do this, there is a $10 monthly membership fee. After that, there is an online application. If chosen, you must submit a three-minute pitch. Then, finalists go on to compete at the NBMBAA annual conference.

Non-Minority Specific Options

There are grants options that can work well even though they are not exclusively for minorities. Some examples include the following.

FedEx Small Business Grant

This grant is the company’s way of working to strengthen small business innovation. There are 10 grants the company awards each year. They range from $15,000 to $50,000, and if you’re a minority owned business with a cutting-edge product, this could be the grant for you.

A business must use the FedEx website to submit entries. There are a few questions to answer about your business. In addition, there is a requirement for an elevator pitch about what makes your business special. Also, you have to explain how you would use the grant funds. A 90 second video submission is optional.

NASE Growth Grants

The National Association for the Self-Employed (NASE) has small business Growth Grants of up to $4,000. In reality, these are for micro-businesses. The proceeds can be used for a number of things. For example, they can be utilized for marketing, advertising, expansion, and even to hire employees. These grants are open to everyone. However, you do have to be a NASE member to apply. Membership fees vary based on the membership level chosen.

USDA Value Added Producer Grant

The USDA’s Value-Added Producer Grant (VAPG) program offers grants for small businesses. It includes minority owned business, and grants range up to $250,000. At their core, these grants are designed to help agricultural producers with activities that add value to their products. As a result, grants are open to those in rural areas. They must be operating as one of the following:

Cooperative
Farmer
Rancher
an independent agricultural producer
or an agricultural producer group

Tips for Landing Any Business Loan

Here are a few tips to help you land any loan, specific to minorities or not.

Work to Increase Fundability

Simply put, fundability is the ability of your business to get funded. That simplicity leaves a lot out however. How do you get to be fundable? What determines fundability? How do you increase fundability?

A potential creditor needs to see that your business is legitimate and profitable. A lot of loan applications are denied approval due to concerns about fraud. Others are not approved because something didn’t look right and threw up a red flag. If you understand what fundability is and how to get it, you can stop any such red flags before they cause you problems.

So what makes a business fundable? Here is a streamlined list.

The Elements of Fundability

A Fundable Foundation
- Separate contact information
- EIN
- Business Bank Account
- Proper Licensing
- Professional Website
Business Credit Reports
- Other Business Information Agencies
- Identification Numbers
- Business Credit History
- Business Information
Financial Statements
- Business Financials
- Personal Financials
- Bureaus
Personal Credit History
Application Process

Go here to get more detail on each of these and how they affect the fundability of your business.

Put Together an Amazing Business Plan

In addition to working on the fundability of your business, you need to have a great business plan to get a lender to pay attention. This is more than just a piece of paper telling a lender about your business. It should include research, projections, and more. A well-put together, complete business plan includes the following.

Opening

An Executive Summary

Simply put, this is a complete summary of the business idea.

Description

The description goes into more detail than the summary when describing the business. For example, what type of business is it? What will it offer? This is where you get others excited about what you are doing.

Strategies

For this piece, layout your plan for getting things up and running. Like, do you have a marketing plan? Is there a location you have in mind? How many employees you will start with? What is your ramp up plan?

Research

Surprising to some, writing a complete business plan requires a ton of research. Not only must you do market research to ensure your product is needed and wanted, but also to see that your location and market coincide. In addition, you need to know that the market can support your business.

It is also necessary to research any existing competitors.

Market Analysis

This actually includes two parts, the analysis of audience and the competitive analysis.

Analysis of Audience

First, what need will your business fill, and for who? For example, will your business fulfill a childcare need for working parents? Next, how will your business fill those needs? Include all of this in the analysis of audience section.

Competitive Analysis

Is there a business currently working to fill this need? Can the market hold more options? Given that information, how do you plan to be the best?

Strategy

This is the way you plan to run your business moving forward. Put another way, it is how you plan to put into action what you learned in the research phase.

Plan for Design and Development

How is all of this going to play out? From start to finish, what steps are you going to take? This section includes more detail than the strategies section.

Plan for Operation and Management

How will ownership be structured, and who will handle the day to day running of the business? It could be as simple as saying you are the sole owner and operator. In contrast, it could mean laying out a complete board of directors format. It just depends on how you plan for your business to work.

Financials

While all parts of the business plan are important, this is where lenders really sit up and pay attention. Even if the whole rest of the plan is fabulous, it will not matter if the financial section isn’t in order.

Financial Information

This section includes current financials, projections, and a plan for the loan funds you are asking for. Lenders need to see that you know how to handle the funds you get, and that you have a plan for paying them back.

If at all possible, you need to hire help with this. A professional writer, accountants, and research consultants can help you make your business plan the best it can be. If you absolutely cannot hire help, there are some great business plan templates out there.

Minority Startup Business Loans: Now You Know

Business loans are a great way to fund a startup, whether you are a minority or not. As a minority business owner, it is important to know what resources are available to you. Equally as important, is that you do not pigeon hole yourself to just minority resources. You need to know, out of the resources that are available to everyone, which ones will work best for minorities. This list should give you a great starting point, but be sure to do your own research as well.

The post Minority Startup Business Loans: What You May Not Know appeared first on Credit Suite.

Business Loans and Fundability: What You Need to Know

What you eat affects your health. How much you study affects how well you do on a test. How well you listen affects your understanding. Our actions have consequences. It’s just a fact. Similarly, the fundability of your business affects your ability to get business loans.

Everything You Need to Know About How Fundability and Business Loans Go Together

Think about it. Getting business loans can be tricky. How could you possibly get funding if your business isn’t fundable? You may be thinking to yourself, what is fundability? It’s simple really. A fundable business is a business that lenders perceive as legitimate and able to pay back their debts.

Lenders Don’t Give Business Loans to Businesses That Lack Fundability

It’s true. Lenders are in it for the money. Therefore, if they see anything that makes them think that lending to your business is a high credit risk, they will not approve business loans. If they feel like you will not repay the loan, they will fear a bad return on investment. They want their money, plain and simple. If it looks like you won’t pay, you are out of luck. Your business has to be fundable to get business loans.

How to Achieve Fundability

Fundability itself is a giant. Honestly, most business owners equate fundability, and thus the ability to get business loans, with a strong credit score and solid profits. However, there is so much more to it. In fact, it starts with the way your business is set up. We call that the foundation of fundability.

Everything related to the foundation of your business can affect your ability to get business loans. Many of the elements you would never dream make a difference to lenders, actually do. Sometimes the data doesn’t take a direct line to lenders, but weaves its way through the maze of public records, data agencies, and credit reporting agencies until a dozen tiny red flags culminate to set off blaring alarms in a lender’s ears.

How do you get a fundability? Start with the foundation.

Business Loans and Fundability: Building a Fundable Foundation

The elements of a foundation of fundability include the following.

Contact Information

The first step in setting up a foundation of fundability is to ensure your business has its own phone number, fax number, and address. Now don’t panic. That doesn’t mean you have to get a separate phone line, or even a separate location. Truthfully, you can still run your business from your home or on your computer if that is what you want. You do not even have to have a fax machine. Find out how here and here.

EIN

The next thing you need to do is get an EIN for your business. If you don’t know, this is an identifying number for your business that works similarly to how your SSN works for you personally. You can get one for free from the IRS.

Incorporate

This is the most important step in fundability thus far. Incorporating your business as an LLC, S-corp, or corporation is necessary to be fundable. The reason is, makes your business appear to be legitimate. Additionally, it offers some protection from liability.

Which option you choose does not matter as much for fundability as it does for what you actually need. The best thing to do is talk to your attorney or a tax professional. You need to know that you are going to lose all of your time in business and any credit history you may have accumulated. That’s because, when you incorporate, you become a new entity. You basically have to start over. You’ll also lose any positive payment history you may have accumulated.

This is why you have to incorporate as soon as possible. Not only is it necessary for fundability and for building business credit, but time in business is important as well. The longer you have been in business the more fundable you appear to be. That starts on the date of incorporation, regardless of when you actually started doing business. The best thing to do is to incorporate from day one if that is an option.

Business Bank Account

You have to open a separate, dedicated business bank account. There are a few reasons for this. First, it will help you keep track of business finances. It will also help you keep them separate from personal finances for tax purposes. Not only that, but certain types of funding will not be available to you in the future without a business bank account.

Licenses

For a business to be legitimate it has to have all of the necessary licenses it needs to run. If it doesn’t, red flags are going to fly up all over the place. Make sure you have all of the licenses necessary to legitimately run your business at the federal, state, and local levels.

Website

These days, you do not exist if you do not have a website. Still, having a poorly put together website can be even worse. For many, this is the first they see of your business. If it appears to be unprofessional, it will not bode well for you with consumers or potential lenders. Have a website that is professionally designed. It’s worth the money it takes to hire a designer. Make sure your email address has the same URL as your website also. Do not use a free email service like Yahoo or Gmail.

Business Loans and Fundability: Business Credit Reports

Your business credit reports, much like your consumer credit reports, detail the credit history of your business. As a result, they help lenders determine the creditworthiness of your business.

They come from a number of sources, known as credit reporting agencies, or CRAs. The main ones are Dun & Bradstreet, Experian, Equifax. Of course, there are others. They are used less often however. Since you have no way of knowing which one your lender will choose, you need to make sure all of these reports are up to date and accurate.

Other Business Data Agencies

In addition to the business credit reporting agencies that directly calculate and issue your credit reports, there are other business data agencies that affect those reports indirectly. Two examples of this are LexisNexus and The Small Business Finance Exchange. These two agencies gather data from a variety of sources, including public records. Consequently, they could have access to information relating to automobile accidents and liens, among other things. Unfortunately, you can’t change the information they already have. What you can do, however, is ensure any further information they have access to going forward is positive.

Identification Numbers

Other than the EIN, there are identifying numbers that go along with your business credit reports. You need to be aware that these numbers exist. Some are simply assigned by the agency. One, however, you need to take action to get. That’s the D-U-N-S number.

Dun & Bradstreet is the largest and most commonly used business credit reporting agency. Every credit file in their database has a D-U-N-S number. To get a D-U-N-S number, you have to apply for one through the D&B website.

Business Credit History

Credit history is the largest factor relating to your credit score. In return, credit score is a huge factor in the fundability of your business.

Credit history involves several factors.

How many accounts are reporting payments?
How long have you had each account?
What type of accounts are they?
How much credit are you using on each account versus how much is available?
Are you making your payments on these accounts consistently on-time?

The more accounts you have reporting on-time payments, the stronger your credit score will be.

Business Information

On the surface, it seems obvious that all of your business information should be the same across the board everywhere you use it. However, when you start changing things up like adding a business phone number and address and incorporating, you may find that some things slip through the cracks.

Since a ton of loan applications are turned down each year because of fraud concerns, this is a problem. Maybe your business licenses have your personal address but now you have a business address. You have to change it. Perhaps some of your credit accounts have a slightly different name or a different phone number listed than what is on your loan application. Do your insurances all have the correct information? Your business information needs to be consistent across all platforms and records.

Business Loans and Fundability: Financial Statements

Both your personal and business tax returns need to be in order. Not only that, but you need to be paying your taxes, both business and personal. Additionally, have financial statements professionally prepared for your business. It’s also a good idea to do the same for your personal financials.

Bureaus

There are several other agencies that hold information related to your personal finances that you need to know about. Everyone knows about FICO. Your personal FICO score needs to be as strong as possible. It really can affect business fundability and almost all traditional lenders will look at personal credit in addition to business credit. Records from other agencies such as ChexSystems can come into play as well.

Personal Credit History

Your personal credit score from Experian, Equifax, and Transunion does matter. You have to have your personal credit in order. It will definitely affect the fundability of your business. The number one way to get a strong personal credit score or improve a weak one is to make payments consistently on time.

Monitor your personal credit to ensure all the information is correct.

Business Loans and Fundability: The Application Process

First, consider the timing of the application. Is your business currently fundable? If not, do some work to increase fundability before applying for business loans. Next, make sure that your business name, business address, and ownership status are all verifiable. Lastly, make sure you choose the right business loans for your needs. Choosing the right product to apply for can make all the difference.

Business Loans and Fundability: How Do You Know Which Type of Lender to Use?

There are so many options it can be hard to figure out which ones will work best for you. First, you need to decide between traditional and non-traditional lenders. If your business is fundable, a traditional lender will work and offer the best rates and terms. If not, you may need to start with a non-traditional, private lender.

Maybe you are somewhere in between. If so, an SBA loan may be perfect. Traditional lenders work with The Small Business Administration to offer loans through their programs.

Business Loans: Options that Can Help Build Fundability

If traditional lenders are not an option, you can look at private lenders. You know business credit is a large piece of fundability. If your business credit is lacking when you are looking for business loans, it can be helpful to find loans that can help build your business credit and thus, your fundability. Some private lenders do this by reporting your on-time payments to business credit reporting agencies. Here are few.

Business Loans from Fundation

Fundation offers an automated process that is super-fast. Originally, they only had invoice financing. Later, they added the line of credit service. Repayments happen automatically. They draft them electronically, and this occurs on a weekly basis. One thing to remember is that you could have a repayment as high as 5 to 7% of the amount you have drawn currently, as the repayment period is relatively short.

You can get loans for as little as $100 and as high as up to $100,000, but the max initial draw is $50,000. They do have some products that go up to $500,000. Though there is no minimum credit score requirement, they do require at least 3 months in business, $50,000 or more in annual revenue, and a business checking account with a minimum balance of $500.

Fundation reports to Dun & Bradstreet, Equifax SBFE, PayNet, and Experian, making them a great option if you are looking to increase fundability by building business credit.

BlueVine

As you find with many alternative small business loans, lenders often offer options more similar to invoice factoring and lines of credit. The reason is, these present less risk than straight term loans. This is true of BlueVine as well as Fundbox.

The minimum loan amount available from BlueVine is $5,000 and the maximum is $100,000. Annual revenue must be $120,000 or more and the borrower must be in business for at least 6 months. Personal credit score has to be 600 or above. Also, BlueVine does not offer a line of credit in all states. You can find out more in our review here.

They report to Experian. They are one of the few invoice factoring companies that will report to the business credit bureaus.

Business Loans from OnDeck

With OnDeck, applying for financing is quick and easy. Apply online, and you will receive your decision once application processing is complete. Loan funds will go directly to your bank account. The minimum loan amount is $5,000 and the maximum is $500,000.

There is a personal credit score requirement of 600 or more. Also, you must be in business for at least one year. There is an annual revenue requirement of at least $100,000 as well. In addition, there can be no bankruptcy on file in the past 2 years and no unresolved liens or judgements.

OnDeck reports to the standard business credit bureaus.

The Business Backer

These guys offer a product they call FlexFund Line of Credit. Funds range in amounts from $5,000 to $240,000. Draws can be repaid on either a daily or weekly basis.

They report to Dun & Bradstreet and Equifax.

Business Loans and Fundability: Now You Know

Of course, it would be impossible to list all of the different types of lenders and loans available to your business. These are a great starting point however. Start with taking a close look at your fundability. Apply for loans that you can get approved for based on that. Then, if you need to work on your fundability, the sooner the better. The longer you wait, the more tangles you will have to work through.

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Additional Minority Owned Business Funding Sources are Available if You Know Where to Look

The United States is known as the melting pot for a reason. It is full of people with roots stretching worldwide. Some countries are less represented than others however. This means we have a lot of citizens in minority groups. In some areas of the country, the entire population is part of a minority group. In 2016, there were 8 million minority owned businesses. This was up 38% from 2007 data. If you have a minority owned business, then you have some additional funding options.

Additional Funding Options for Your Minority Owned Business

These options come in the form of loans and grants for minority owned business. You need to know where to look. You also need to know eligibility requirements. This will help you prepare your application. A great application will help to improve your chance of winning a grant or loan approval.

Minority Owned Business Grants

Grants are basically free money. You never have to pay it back. However, they are also highly competitive. In addition, they are rarely enough to completely fund a business. Still, grant money can reduce the need to borrow money.

Here are some minority grant options to consider. There are certainly others out there though. They are not always well advertised. This means you need to be sure to do your own research as well.

First Nations Development Institute Grants

This group has a mission to offer grants to help Alaska Natives, Native Hawaiians, and Native Americans. In addition to the funds, they offer assistance in the application process.

There is a wide range of opportunities from the First Nations Development Institute, with new ones rolling on as old ones roll off. Join the mailing list to be notified of new opportunities as they are posted.

National Black MBA Association Scale-Up Pitch Challenge

Also known as NBMBAA, their Scale-Up Pitch Challenge offers prizes in cash ranging from $1,000 to $50,000. The purpose of the association is to help newer businesses that have an African founder that maintains equal ownership.

A business must be an NBMBAA member to compete. There is a $10 monthly membership fee. Then, there is an online application. If chosen, a business must submit a three-minute pitch. Finalists will go on to compete at the NBMBAA annual conference.”

FedEx Small Business Grant

This grant is the FedEx way of working to strengthen small business innovation. The company awards 10 grants. They range from $15,000 to $50,000 every year. If you’re a minority owned business owner with a cutting-edge product, this could be the grant for you.

You have to submit entry via the FedEx website. It requires that you answer a few questions about your business. This includes providing an elevator pitch about what makes your business stand out. In addition, you have to explain how you would use the grant funds. You can also submit an optional 90 second video.

NASE Growth Grants

The National Association for the Self-Employed (NASE) has small business Growth Grants that range up to $4,000. Grant recipients must be micro-businesses. Proceeds can be used to help your business market, advertise, expand, and hire employees. These grants are open to everyone. However, you do have to be a NASE member to apply. Cost of membership depends on the member level you choose.

USDA Value Added Producer Grant

The USDA’s Value Added Producer Grant (VAPG) program offers grants for small businesses. This includes minority owned business. Grants range up to $250,000. They are specifically to help agricultural producers with activities that add value to their products. Grants are open to those in rural areas. They must be operating as cooperatives, farmers, ranchers, independent agricultural producers, or agricultural producer groups.

Minority Owned Business Resources

These resources do not offer grants or any type of funding directly. Still, they can be a great help and support in finding funding. They can also help with other issues that come with being a minority business owner.

Minority Business Development Agency (MBDA)

This agency is under the direction of the United States Department of Commerce. It helps minority business owners and minorities that want to become business owners. They have business centers all around the country. They offer help finding grants that could be a good fit. In addition, they offer help with the application process.

USA.gov

While not minority specific, this website offers a list of government resources. This includes resources for any minority owned business. It also provides links to many federal government agencies that offer loans and grants for minority small business.

Grants.Gov

This is another resource to help find grants for your minority owned business. In addition to a list of grant opportunities, it has information that can help you create a winning grant application package.

There are over 1,000 grants to dig through. Most of them are for research and development purposes. You should still take the time to look at them, as you may find one that will work well for your business.

Loans for Minority Owned Business

Loans for minority business owners can come from several different sources. Some only offer minority business loans to those in certain cities. Some are only available if you are looking to land government contracts. Each have their own requirements. It takes a lot of research to line everything out and see what is available. We have a list of some of the best options to help you get started.

Business Consortium Fund, Inc.

This program is through the US Department of the Treasury. Typically, businesses can qualify for $75,000 to $500,000 after approval. Amounts above $500,000 are possible. However, they are on a case by case basis only.

Businesses can use funds for working capital, equipment financing, and contract financing. To apply, you have to certify your business through The National Minority Supplier Development Council. In addition, a business must have a supplier relationship with the Council to be eligible.

National African American Small Business Loans

These loans are only available in Chicago, Los Angeles, and New York. They go to communities with low to medium incomes. The NASBLF provides capital to African American owned businesses that are not eligible for traditional financing options.

The range for loans is $35,000 to $250,000. Borrowers can use funds to help with cash flow, expansion, and equipment purchases. Thirty million dollars total are available each year.

Accion

Accion offers loans in all states for minority owned business. They also serve veterans, women, and those with disabilities. Low to medium income business owners may also be eligible. Loan amounts range from $200,000 to $300,000. They work to help build businesses from square one. They can also put owners in contact with other banks, non-profits, and government resources to help build a network of support.

The minimum credit score for these loans is 575. In addition, you cannot be 30 days late on credit cards, loan payments, or bills. Late rent or mortgage payments over the past year will also disqualify you.

Community Development Financial Institutions Fund

CDFI lends to communities that typically lack banking options. This includes minorities. Since the Community Reinvestment Act of 1977, banks must offer funding in communities that find it hard to get traditional funding. Big banks often fund minority business owners indirectly through their CDFI partners.

To locate a CDFI, contact the local business development center. Your local Small Business Development Center office should also be able to help.

The application process can be long. Thankfully, they do offer assistance to prepare for future bank loans as well.

Union Bank Business Diversity Lending Program

This program from Union Bank assists minority business owners with loans and lines of credit. To qualify as a minority for the program, you must be Latinx, American Indian, Asian, Alaskan Native, African American, Native Hawaiian, or other Pacific Islander.

Other requirements must be met as well. For example, you must be in business for at least 2 years, and the minority business owner must own at least 51 percent.

Indian Affairs

Native American business owners can get loans from the federal government. These come through the Indian Affairs branch. You apply with any lending institution. You just have to use the Indian Affairs application. If the funds are for construction, renovation, or refinancing, there will be additional requirements. Generally, a list of collateral, a credit report, and an analysis of business operations are necessary.

Camino Financial

Camino is an online lender that offers minority business owners loans and business solutions. All processes take place online, making it an easy option. Their microloans range from $5,000 to $50,000. They also offer small business loans between $10,000 to $400,000. There is no collateral requirement. As a benefit, you can pay off the loan any time with no penalties or fees.

SBA Options for Minority Owned Business

In addition to these options, the Small Business Administration has some programs that may work well, though they are not for minorities only.

SBA Community Advantage Loans

Community advantage loans are for underserved communities that need less than $250,000. Likewise, you can find lenders that work with the SBA on this program using the SBA Lender Match tool.

SBA Microloans

They also have microloans available of up to $50,000. Unlike others, these are offered through nonprofit organizations. With interest rates ranging from 8% to 13% and maximum repayment terms of six years, they can work well for minority business owners.

One of the SBA’s partners in this program is The Opportunity Fund. According to them, 90% of its borrowers are minority business owners.

SBA 7 (a) Loans

Like other SBA programs, these are not specifically for minorities. Still, they are available to minorities the same as everyone else. They are 10-year loans of $30,000 to $350,000. Rates range from 9.7% to 11.04%, and they can turn around in as little as 7 days. More often they take up to several weeks.

Private Lender Options for Minority Owned Business

Again, these are not necessarily only for minorities. However, many alternative lenders offer loans that work well. Specifically, minority owned businesses sometimes struggle with meeting credit score requirements. The following loans are available with a lower credit score than what most traditional lenders require.

Fundbox

Surprisingly, there is no minimum credit score. In fact, if you have at least $50,000 in annual revenue you can qualify for a line of credit from Fundbox. Additionally, you also need to be in business for at least 3 months. Amounts range from $1,000 to $100,000 with rates from 10.1% to 79.8%. Terms are for 12 weeks, and you can have your funds as quickly as the next business day.

Kabbage

Another lender that will make loans on credit scores as low as 500 is Kabbage. Terms are for 6, 12, or 18 months and amounts range from $2,000 to $250,000. So interest rates are higher, at 24% to 99%. Funding can take several days, but sometimes happens in just a few minutes.

QuarterSpot

QuarterSpot is another option. Many prefer it, due to terms that go up to 18 months. Loans range from $5,000 to $250,000, but rates are pretty high at 30% to 70%. Nevertheless, approval can happen in as little as 24 hours.

Credibility Capital

Loans with Credibility Capital range from $50,000 to $400,000. Terms are for 1, 2, or 3 years, and rates range from 10% to 25%. So like most, funding usually takes around 7 days.

SmartBiz

SmartBiz offers low cost financing for expansion. Unlike the others, these are SBA loans. However, with SmartBiz funding happens a lot faster than with traditional banks. In fact, they can take a few weeks rather than a few months.

A Minority Owned Business Has Additional Funding Options Available

It’s true. In addition to the traditional options, there are other funding resources available to help minority business owners. While many of them, like grants, will not fully fund a business, they can all reduce the need for debt. The key is knowing where to find them and how to qualify. The list above is a great starting point, but there is so much more. It’s worth the time it takes to dig in and see what is available.

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Business Experian: A Comprehensive List of Everything You Need to Know

Many business owners do not understand their business credit score. What is it? How is it generated? What can I do to make it higher? Individual consumers normally find that much of their lending life rests on the FICO score, but what about businesses? Which scores do business owners need to worry about?

There are many options for business credit reports. Why worry about Experian? Business Experian is one of the main three busing credit reporting agencies. The other two are Dun & Bradstreet and Equifax.

Everything You Need to Know About Business Experian: From Profile to Improving Your Score

You need to know what your business Experian reports say. Honestly, knowing what information lenders are getting from this report is necessary to help you determine your business fundability. To understand completely, you need to know where the information on the report comes from, of course. But that’s not all. You also need to know how they calculate the business credit score.

Business Experian: How Do They Get Your Information?

Experian keeps business credit profiles on 99.9% of all United States businesses. According to them, they hold the credit industry’s most inclusive database on small businesses. As a result, if your business is already operating, it probably already has a business Experian file.

Their information comes from third party sourcing. Consequently, you cannot add anything to your business credit profile yourself. You can, however, still review your profile. Then, you can tell them about any mistakes and have those mistakes corrected.

Business Owner Profile

For smaller companies, Experian will add a business owner profile. This is to show the relationships between you and your business. Experian’s Business Owner Link automatically links the credit history of more than 5 million business owners to their business credit history. This makes things easier for creditors to find a Business Owner Profile on small business accounts. It also makes it easier for them to determine overall creditworthiness.

What’s on Your Business Experian Report?

Experian sells different products and reports that keep track of a business’s credit.

Business Credit Advantage Plan

This is presently $149 monthly and incorporates mobile-friendly alerts and score improvement pointers.

Profile Plus Report

This report is currently priced at $49.95 and it includes financial payment details and predictive information on payment behavior.

Credit Score Report

The least costly of the available reports, it is currently $39.95. This fundamental report features detailed company and credit information. It also shows summary financial payment information.

Valuation Report

At $99, this report is a middle of the road option in terms of cost. It shows the value of your business and features Key Performance Indicators. It also shows the fair market value of the business.

Premium Corporate Profiles

For an additional charge, Experian also offers premium corporate profiles. They enhance these profiles by adding extra information. Additional data includes sales figures, size, contact details, products and operations, credit summary, any Uniform Commercial Code (UCC) filings, fictitious business names, plus payment and collections history. In addition, these premium profiles have information on credit inquiries made in the last nine months. UCC specifics and financial details from Standard & Poor’s round out the information on this report.

What Does Your Business Experian Report Tell Lenders?

A business Experian report is set up in several different sections. We break it down below.

Identifying Information

This report is split within itself. First, you get the standard identifying data and details of ownership. This area also lists major personnel, company type, and length of time in business. Number of employees and annual sales are on this report as well.

Payment Information at a Glance

After that, there is a section noting delinquent payments. It also shows those payments they expect to go delinquent. Additionally, you can see the lowest and highest balances for the past six months and the current balance. By showing the highest credit limits, there is an idea of the highest credit utilization rate.

In addition, this segment contains the number of tradelines a business holds. Also, it has the number of credit inquiries in the past. Uniform Commercial Code filings are on this list too.

Next, there is a relative percentage showing the percent of businesses doing worse than the one in the report. Lastly, you can see the number of bankruptcies, liens, and judgments.

Credit Summary

After that is the credit summary. This shows the company’s Experian credit score. It also has links to information about what enters into the score and tips on exactly how to improve it.

Payment Summary

The next area is the payment summary. It shows line graphs for monthly and quarterly payment trends. It also shows where those numbers originated from. The monthly payment trend is even graphed against the industry average.

Just below this pair of graphs are three bar charts showing continuous payment trends. The first includes tradelines that have been reported for over 6 months. The next includes tradelines that have been reporting for 6 months. At the end, there is a chart that shows these payment trends in combination.

Trade Payment Information

How has the business done with making payments? This section will tell you. It breaks payments into credit card and leasing accounts. Then, it further breaks them down by supplier category. Lastly, payment trends are at the bottom.

Inquiries

This part is pretty self-explanatory. This is where the inquiries into the company’s credit are listed.

Collection Filings

If a business has any collection filings, they’ll be in this section in date order. It will also list collection agency name, status, amounts contested and collected, and the closed date.

Commercial Banking, Insurance, Leasing

This portion shows what Experian knows about your company in relation to banking, insurance, and leasing. For example, what was credit extended for? How much credit was extended? When did the loan start? Is there any remaining balance? If so, how much?

Judgment Filings

Next the report shows basic legal information. For example, the court where a judgment was filed, the day, and what amount it was for.

Tax Lien Filings

Tax lien filing data is similar to judgment filings, except that there is a listing for a filing location, rather than a court.

UCC Filings

This only displays the date, filing number, jurisdiction, name of the secured party, and activity on the filing.

Business Experian Credit Monitoring

Obviously, you can register for business credit alerts. Experian’s Business Credit Advantage program operates as a self-monitoring service. You get unrestricted access to your company’s business credit report and score. You can use this resource for proactively managing your company credit. Alerts are sent for:

Company address changes
Changes in your business credit score
Credit inquiries on your business profile
Newly-opened credit tradelines
Any kind of USS filings
Collection filings and
Any public record filings, such as liens, bankruptcies, and judgments

However, we can help you monitor your credit with business Experian for a fraction of the cost. Go here to find out more.

Business Experian: Intelliscore Plus

You need to understand this score and how it works. You may not be able to change it much, but by understanding the score, what it tells lenders, and how it is calculated, you can work to mitigate any negative issues with positivity.

What is the Intelliscore Plus Credit Score?

The Intelliscore Plus credit score is credit-risk analysis. The primary function of Intelliscore Plus is to help businesses, investors, and prospective lenders make well educated judgments about who they should or should not do business with.

Intelliscore Plus Credit Score Range

The Intelliscore scores range from 1 to 100. The higher the score, the lower the risk class. In contrast, the lower the score, the higher the risk class. It breaks down like this:

Score Range Risk Class

76 – 100 Low
51 – 75 Low – Medium
26 – 50 Medium
11 – 25 High – Medium
1 – 10 High

How Does Business Experian Calculate Intelliscore Plus?

In the credit world, Intelliscore Plus is regarded as one of the most reliable tools for determining credit risk. Here’s why. They use over 800 variables to calculate the score. That’s a lot, but they all fit into these three general categories.

Payment History

This features the number of times accounts have become delinquent, the percent of accounts that are currently delinquent, and your overall trade balance.

Frequency

Frequency is related to payment history. It takes into account how many times your accounts have been sent to collections, liens and judgements, and any bankruptcies on both business and personal accounts.

This also relates to payment patterns. Were you regularly slow or late with payment? Did you begin by paying bills late but now you are doing better? This is all taken into account.

Monetary

This detail focuses on how you make use of credit. For example, how much of your available credit is currently being used? Do you have a high ratio of delinquent balances in relation to your credit limits?

If you’re about to start a small business or are relatively new to this game, the list above may seem a bit overwhelming. Furthermore, how will you rate if you have a short time in business?

This is where the blended model comes into play. This means that they take your personal credit score into consideration when calculating your business’s credit score.

Can You Do Anything to Improve Your Business Experian Score?

While you may not be able to do anything to make a big score increase happen all at once, you can definitely do some things that will make a positive difference over time.

Pay on Time

This is number one. Over time, paying your bills punctually will help establish your company as one that satisfies their debts. This will definitely help push your score up and show other firms that you are a low credit risk.

Make Wise Credit Choices

The more debt you have on your plate, the more monthly bills you have. Consequently, the less disposable income you have. If your overall debt is close to or even over your income, your business with appear to be a high credit risk.

Keep your debts in check and consistently pay them down or off. So this is to keep a healthy balance between what you make and what you owe.

Use the Credit You Have

Keeping your debts low remains solid advice. But you have to make use of the business credit accounts you have. You have to be making payments on accounts for your score to grow. Having a ton of credit and not using it at all doesn’t really help. This, again, is where balance comes into play.

There is no need to buy things you do not need however. Even if you can pay cash, use credit for the things you would be buying regularly for your business anyway. Then, use the cash to pay the credit account.

Watch Your Personal Credit

By now, you’re aware that personal credit is fair game when it comes to your Intelliscore Plus score. Don’t fall into the trap of thinking your personal credit doesn’t matter. If it is bad, there are options for working around it. However, it is much better to just keep it healthy. Making certain you stay on top of your monthly bills is the number one way to keep your personal score strong. Avoid unneeded credit inquiries, and refrain from compromising your personal credit for business demands.

Make Use of Monitoring Options

No matter what your credit score is, it is crucial that you continue to be diligent. Sod review your personal and business credit reports. This can help you spot possible errors and stay educated on your own credit profile.

Business Experian Credit Scores Make a Difference When it Comes to Funding

It’s important to understand your business Experian score. It can affect your ability to get funding. So you need to know what it is, what it tells lenders, and what affects it. Once you know these things, you can work from your end to keep it as high as possible. In turn, this will greatly improve your ability to fund your business.

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Top 5 Things You Didn’t Know About Small Business Credit

There is so much about small business credit that is misunderstood. Many entrepreneurs do not even realize their company can have its own credit. Those that do realize it, often have a very skewed idea about how it works. Because we are so familiar with personal credit, we tend to assume business credit works the … Continue reading Top 5 Things You Didn’t Know About Small Business Credit